Due diligence.  What is it, and why is it so important?

When you’re considering buying a business, you’ll want to be sure that you’re paying a fair price for the business. You may wonder why the business is up for sale if it is such a good business?

Essentially, due diligence means digging deeper – which is what we help you to do.

We review all of the available information related to that business to ensure that there are no unpleasant surprises if you decide to go ahead with the purchase.

On your initial visit to us, we do an initial appraisal. We consider the asking price (split between goodwill, stock, buildings and equipment) and recent financial statements(3-5 years). That information will give us an idea if the business has enough interest to look into it further.

If it looks promising, then we can work with you to gain a true value for the business. For this we will need much more information.

The due diligence will examine supply chains, staff issues, lease agreements, inventory and bookkeeping systems in place, and a raft of other information.

For a small investment you may be able to use these findings as a basis to push for a better deal, obtain an easier path for finance, or at the very least you will know the business “warts and all”.

At the end of the process you should have a clear picture of how strong the business is today, what it’s prospects are for the future, why the owner is selling and whether the price asked is a fair price.

Due Diligence Buying a business Selling a business

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Call us today and let’s discuss your options